Channelnomics Original

ISPs poised to embrace next-gen standard, diversify bills of fare

Channelnomics Staff

IT marketplace Spiceworks this week unveiled its 2019 State of Corporate Connectivity report, which reveals that 5G is likely to spur increased competition among ISPs as they look to expand their portfolios beyond Internet service.

The Lowdown: According to the Spiceworks study, one in three polled businesses plans to purchase new 5G devices once the service becomes available. More than half (55%) of respondents with 5G purchase plans intend to buy 5G-enabled devices within a year of availability. Specifically, 83% plan to buy 5G-enabled smartphones; 44% plan to buy 5G-capable modems; 42% are set to buy 5G-enabled tablets; and 7% plan to purchase IoT devices that leverage 5G.

The Details: Most of the businesses surveyed are considering or planning the purchase of one or more additional services through their ISP beyond just Internet connectivity. The top services: • VoIP (43%) • VPN/MPLS (30%) • mobile data (19%) • unified communications (18%) • SD-WAN (11%)

Further, enterprises are even more likely than their small and midsize peers to purchase additional services through their ISPs. They’re twice as likely to purchase VPN/MPLS, mobile data, and unified communications, and three times more likely to recruit an ISP for data storage, mobile device management, and network planning services.

Background: The Spiceworks survey, conducted this past February, included 716 technology buyers in the Spiceworks network. Respondents represented organizations in the United States (76%) and the United Kingdom (24%), spanning the gamut in terms of size, with 36% from small businesses (1 to 99 employees), 55% from midsize businesses (100 to 999 employees), and 9% from enterprises (1,000-plus employees). The polled businesses also hailed from various industries, including construction, education, finance, government, health care, IT services, manufacturing, and retail.

The Buzz: “New 5G service can allow ISPs to extend their reach and offer high-speed broadband service to new cities and neighborhoods without having to incur last-mile expenses associated with physically connecting homes and businesses,” said Peter Tsai, senior technology analyst at Spiceworks. “As a result, 5G will likely spark more competition among ISPs, ultimately benefiting businesses within 5G coverage zones.

“[A] lack of differentiation in the brand perceptions [of ISPs] suggests businesses view each provider as relatively interchangeable,” Tsai added. “However, there are opportunities for ISPs to stand out from the competition by embracing emerging technologies like 5G and offering additional IT services beyond Internet connectivity.”